LEDBOROUGH LTD

Executive Summary

Ledborough Ltd, a recently incorporated property letting company, presents a high risk profile due to significant negative net assets and poor liquidity, largely driven by substantial intra-group liabilities. While the holding of investment property offers some asset backing, the company's ability to meet short-term obligations is questionable without further capital injection or restructuring of debts. Compliance with filing obligations is maintained, but operational and financial sustainability concerns warrant thorough investigation.

LEDBOROUGH LTD - Analysis Report

Company Number: 15002907

Analysis Date: 2025-07-29 14:23 UTC

1. Risk Rating: HIGH
   The company shows significant net liabilities and negative working capital, indicating a high risk of solvency issues. The current liabilities vastly exceed current assets, and shareholders' funds are deeply negative.

2. Key Concerns:

• Solvency Risk: The company’s net assets are negative (£21,133 as of 31 March 2025) with current liabilities (£350,597) greatly exceeding current assets (£3,404), indicating potential inability to meet short-term obligations.
• Liquidity Concerns: Cash reserves are very low (£2,591), insufficient to cover current liabilities, suggesting liquidity stress and potential cash flow problems.
• Reliance on Related Party Debt: A large portion of creditors (£348,402) are amounts owed to group undertakings, which may indicate dependency on intra-group funding rather than external financing or operational cash flow.

3. Positive Indicators:

• Investment Property Asset: The company holds investment property valued at £330,000, which is a substantial fixed asset and has appreciated in value compared to the prior year.
• No Overdue Filings: Both accounts and confirmation statement filings are up to date, indicating compliance with statutory requirements.
• Stable Directorship: Directors appear consistent with no disqualifications or governance red flags noted.

4. Due Diligence Notes:

• Investigate the nature and terms of amounts owed to group undertakings, including repayment schedules and any guarantees.
• Assess the operational business model and revenue generation capacity given very limited current assets and small debtor balances.
• Review cash flow forecasts and contingency plans for meeting current liabilities given the poor liquidity position.
• Confirm the valuation and marketability of the investment property to understand the recoverable value in a distressed scenario.
• Clarify why the company reports significant net liabilities despite holding a substantial investment property and whether there are off-balance sheet liabilities or contingent exposures.